Amendment No. 1 To Credit Agreement

Exhibit 10.2



AMENDMENT NO. 1 TO CREDIT AGREEMENT



AMENDMENT NO. 1 TO CREDIT AGREEMENT dated as of May 5, 2005 (this " Amendment ") among Alliant Techsystems Inc., a Delaware corporation (the " Borrower "), the lenders from time to time parties to the Credit Agreement referred to below (the " Lenders "), Bank of America, N.A. (" Bank of America "), as swing line lender (the " Swing Line Lender "), Bank of America, Calyon New York Branch (f/k/a Credit Lyonnais New York Branch), U.S. Bank National Association and JPMorgan Chase Bank, as L/C issuers (collectively, the " L/C Issuers ") and Bank of America, as administrative agent (the " Administrative Agent ") for the Lenders.



PRELIMINARY STATEMENTS:



(1) The Borrower, the Lenders, the Swing Line Lender, the L/C Issuers, the Administrative Agent and others have entered into a Credit Agreement dated as of March 31, 2004 (as amended, supplemented otherwise modified prior to the date hereof, the " Credit Agreement "). Capitalized terms used herein and not otherwise defined in this Amendment (including in Section 1 hereof) have the same meanings as specified in the Credit Agreement;



(2) The Borrower desires to (a) refinance the Outstanding Amount of Term B Loans under the Credit Agreement with the proceeds of a new tranche of term loans (as further described in the amendments set forth in Section 1 below, the " Term A Loans "), (b) amend the rate of interest applicable to the Revolving Credit Facility as set forth in Section 1 below, (c) amend certain other provisions of the Credit Agreement as set forth below, and (d) obtain the release of the existing Mortgage with respect to the Mortgaged Property in Minnesota, and the Borrower has requested that the Lenders amend the Credit Agreement to permit, and provide for, the foregoing;



(3) Each Term A Lender party to this Amendment has committed to make Term A Loans to the Borrower, subject to the terms and conditions hereinafter set forth, on the First Amendment Effective Date in an amount equal to its Term A Commitment as set forth on Schedule 2.01 hereto and the aggregate proceeds of the Term A Loans will be used by the Borrower to refinance in full the Outstanding Amount of all Term B Loans, to pay related fees and expenses, and for other corporate purposes;



(4) The Lenders have agreed, subject to the terms and conditions hereinafter set forth, to amend the Credit Agreement as set forth below;










(5) NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the sufficiency and receipt of all of which is hereby acknowledged, the parties hereto hereby agree as follows:



SECTION 1. Amendments to Credit Agreement . Upon, and subject to, the satisfaction of the conditions precedent set forth in Section 4 below, the Credit Agreement is hereby amended as follows:



(a) Section 1.01 of the Credit Agreement is amended by adding in the appropriate alphabetical order the following new definitions.



" First Amendment " means Amendment No. 1 to this Agreement, dated as of May 5, 2005, among the Borrower, Bank of America, N.A., as Administrative Agent and the Lenders party thereto.



" First Amendment Effective Date " has the meaning specified in the First Amendment.



" Funding Indemnity Agreement " means the Funding Indemnity Agreement, dated May 5, 2005, duly executed and delivered by the Borrower to the Administrative Agent.



" Term A Borrowing " means a borrowing pursuant to Section 2.01(d) consisting of simultaneous Term A Loans of the same Type made by the Term A Lenders.



" Term A Commitment " means, as to each Term A Lender at any time, its obligation to make Term A Loans to the Borrower pursuant to Section 2.01(d) in an aggregate principal amount at any one time outstanding not to exceed the amount set forth opposite such Term A Lender92s name on Schedule 2.01 attached to the First Amendment under the caption "Term A Commitment" or in the Assignment and Assumption pursuant to which such Lender becomes a party hereto, as applicable, as may be adjusted from time to time in accordance with this Agreement. The aggregate Commitment of all Term A Lenders shall be $270,000,000 on the First Amendment Effective Date.



" Term A Facility " means, at any time, (a) prior to the making of Term A Loans, the aggregate Term A Commitments of all Term A Lenders at such time, and (b) thereafter, the Outstanding Amount of Term A Loans of all Term A Lenders at such time.



" Term A Lender " means, at any time, any Lender that has a Term A Commitment or a Term A Loan at such time.



" Term A Loan " means an advance made by any Term A Lender under the Term A Facility pursuant to Section 2.01(d) .



" Term A Note " means a promissory note of the Borrower payable to the order of any Term A Lender, in substantially the form of Exhibit A to the First Amendment,



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evidencing the aggregate indebtedness of the Borrower to such Term A Lender resulting from the Term A Loans made or held by such Term A Lender.



(b) Section 1.01 of the Credit Agreement is further amended as follows:



(i) By amending and restating in full the definition of " Applicable Rate " to read as follows:



" Applicable Rate " means for any day, (a) in case of the Revolving Credit Loans and the Term A Loans, with respect to Base Rate Loans and Eurodollar Rate Loans, and the commitment fee payable in respect of the unutilized portion of the Revolving Credit Facility, the applicable rate per annum set forth below in the grid captioned "Revolving Credit Facility and Term A Facility 96 Applicable Rate", under the captions "Base Rate Percentage", "Eurodollar Percentage" or " Commitment Fee" cited therein, as the case may be, based upon the Senior Secured Credit Rating and the Consolidated Leverage Ratio as set forth in the most recent Compliance Certificate received by the Administrative Agent pursuant to Section 6.02(b) and (b) in the case of any Incremental Term Loans, the applicable rate per annum set forth in the applicable Incremental Term Facility Supplement for Base Rate Loans and Eurodollar Rate Loans:





Revolving Credit Facility and Term A Facility 96 Applicable Rate





Pricing
Level Consolidated
Leverage Ratio Commitment
Fee Eurodollar
Percentage Base Rate
Percentage

1 <3.00x and Senior Secured Credit Rating, with "stable outlook" or "positive outlook", of BB+ or better or Ba1 or better 0.250% 1.00% 0%

2 3.50x and Senior Secured Credit Rating of better than BB- and Ba3 0.375% 1.50% 0.50%

4 > 3.50x 0.500% 1.75% 0.75%




Any increase or decrease in the Applicable Rate resulting from a change in (a) the Consolidated Leverage Ratio shall become effective as of the first Business Day immediately following the date a Compliance Certificate is delivered pursuant to Section 6.02(b) ; provided , however , that if a Compliance Certificate is not delivered within two Business Days after the date when due in accordance with such Section 6.02(b) , then Pricing Level 4 shall apply as of the first Business Day after such second Business Day until the first Business Day after the date on which such Compliance Certificate is delivered, and (b) the Senior Secured Credit Rating shall become effective as of the first Business Day immediately following the date of such change in Senior Secured Credit Rating."



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(c) Section 1.01 of the Credit Agreement is further amended by amending and restating in full the definitions of " Fee Letter ", " Incremental Term Facility Closing Date ", " Loan Documents ", " Maturity Date ", " Restricted Payment ", " Term Borrowing ", " Term Commitment ", " Term Commitment Increase Availability ", " Term Facilities ", " Term Loan " and " Term Note " to read, respectively, as follows:



" Fee Letter " means, collectively, (a) the letter agreement, dated February 24, 2004, among the Borrower, BAS and Bank of America and (b) the letter agreement, dated April 11, 2005, among the Borrower, BAS and Bank of America.



" Incremental Term Facility Closing Date " means in respect of an Incremental Term Facility any date on which all of the conditions to funding of the Incremental Term Loans under such Incremental Term Facility are satisfied and the applicable Lenders advance Incremental Term Loans.



" Loan Documents " means, collectively, (a) for purposes of this Agreement and the Notes and any amendment, supplement or other modification hereof or thereof and for all other purposes other than for purposes of the Guaranty and the Collateral Documents, (i) this Agreement, (ii) the Notes, (iii) the Guaranty, (iv) the Collateral Documents, (v) the Fee Letter, (vi) each Issuer Document, (vii) each Incremental Term Facility Supplement and (viii) the Funding Indemnity Agreement and (b) for purposes of the Guaranty and the Collateral Documents, (i) this Agreement, (ii) the Notes, (iii) the Guaranty, (iv) the Collateral Documents, (v) each Issuer Document, (vi) the Fee Letter, (vii) each Incremental Term Facility Supplement, (viii) the Funding Indemnity Agreement and (ix) each Secured Hedge Agreement.



" Maturity Date " means (a) with respect to the Revolving Credit Facility (including the Letter of Credit Sublimit and Swing Line Sublimit thereunder), the earlier of (i) the fifth anniversary of the Closing Date (or in the case of any Letter of Credit or request for L/C Credit Extension, the Letter of Credit Expiration Date) and (ii) the date of termination in whole of the Revolving Credit Commitments, pursuant to Section 2.06 or 8.02 , (b) with respect to the Term A Facility, the earlier of (i) the fifth anniversary date of the Closing Date and (ii) the date of acceleration of the Term A Facility pursuant to Section 8.02 and (c) with respect to any Incremental Term Facility, (i) the final maturity specified in the applicable Incremental Facility Term Supplement and (ii) the date of acceleration of the Incremental Term Facility pursuant to Section 8.02 ; provided that, notwithstanding the foregoing, (x) if on or prior to November 1, 2010, the Borrower shall not have reserved cash, obtained committed financing or any combination of the foregoing, all on terms and conditions reasonably satisfactory to the Administrative Agent at such time, in an aggregate amount necessary to pay all amounts outstanding, including principal and all accrued interest, in full under the Senior Subordinated Notes on the scheduled maturity date of the Senior Subordinated Notes, November 10, 2010 shall be the final maturity date of all of the Facilities (other than the Revolving Credit Facility and the Term A Facility) and final payment of all amounts under all of the Facilities (other than the Revolving Credit Facility and the Term A Facility) then outstanding plus all accrued interest shall be immediately due and payable on November 10, 2010, and (y) with respect to such committed financing, if definitive



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documentation therefor shall not have been entered into and all conditions to funding thereunder shall not have been satisfied ten Business Days prior to the scheduled maturity date of the Senior Subordinated Notes, such tenth Business Day prior to the scheduled maturity date of this Senior Subordinated Notes shall be the final maturity date of all the Facilities (other than the Revolving Credit Facility and the Term A Facility) and all amounts under all of the Facilities (other than the Revolving Credit Facility and the Term A Facility) then outstanding plus accrued interest shall be immediately due and payable on such tenth Business Day prior to the scheduled maturity date of the Senior Subordinated Notes.



" Restricted Payment " means (a) any dividend or other distribution (whether in cash, securities or other property) with respect to any capital stock or other Equity Interest of the Borrower or any Subsidiary, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, defeasance, acquisition, cancellation or termination of any such Equity Interest, or on account of any return of capital to the Borrower92s stockholders, partners or members (or the equivalent Persons thereof), or any option, warrant or other right to acquire any such dividend or other distribution or payment; provided , however , that no such dividend, distribution, payment or return of capital shall constitute a "Restricted Payment" to the extent made solely with the common Equity Interests of the Borrower or (b) any payment, prepayment, redemption (whether at the option of the holder or otherwise), purchase, defeasance, distributions involving cash, acquisition or other retirement for value in respect of any subordinated Indebtedness or any convertible debt securities or instruments, in each case, of the Borrower or any Subsidiary.



" Term Borrowing " means any Term A Borrowing or Incremental Term Borrowing, as applicable.



" Term Commitment " means any Term A Commitment or Incremental Term Commitment, as applicable.



" Term Commitment Increase Availability " means at any time (a) $330,000,000 plus (b) the principal amount, up to $270,000,000, by which the Term A Facility shall have been repaid as a result of scheduled amortization and any mandatory or optional prepayments minus (c) the aggregate initial principal amount of all Incremental Term Facilities.



" Term Facilities " means, at any time, the aggregate Term A Facility and the Incremental Term Facilities of all Lenders at such time.



" Term Loan " means any Term A Loan or Incremental Term Loan, as applicable.



" Term Note " means any Term A Note or a promissory note of the Borrower payable to the order of any Incremental Term Loan Lender, in substantially the form of Exhibit C-1 hereto, evidencing the aggregate Indebtedness of the Borrower to such Incremental Term Loan Lender resulting from the Incremental Term Loans made by such Incremental Term Loan Lender.



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(d) Section 1.02 of the Credit Agreement is hereby amended by (i) relettering the last clause thereof as clause (d) and (ii) adding at the end thereof the following new subsection (e) :



"(e) On and after the First Amendment Effective Date, all Term Loans (including the Term A Loans) shall have, and continue to have, the same terms, rights and benefits as the Term Loans immediately prior to the First Amendment Effective Date under the Loan Documents, except as modified by the First Amendment."



(e) Section 2.01 of the Credit Agreement is hereby amended by inserting the following clause (d) at the end thereof:



"(d) Term A Borrowings . Subject to the terms and conditions set forth herein, each Term A Lender severally agrees to make, on the First Amendment Effective Date, a single loan consisting of a Term A Loan pursuant to the Term A Facility in an amount equal to its Pro Rata Share of the Term A Facility to the Borrower on any Business Day. The Term A Borrowing shall consist of Term A Loans made simultaneously by the Term A Lenders in accordance with their respective Pro Rata Share of the applicable Term A Facility. Amounts borrowed under this Section 2.01(d) and repaid or prepaid may not be reborrowed. Term A Loans may be Base Rate Loans or Eurodollar Rate Loans, as further provided herein."



(f) Section 2.03(a)(ii)(A) of the Credit Agreement is amended by deleting the reference to "Twelve months" therein and replacing it with the phrase "eighteen months".



(g) The first sentence in Section 2.03(i) of the Credit Agreement is amended in its entirety to read:



"The Borrower shall pay to the Administrative Agent for the account of each Revolving Credit Lender in accordance with its Pro Rata Share, a Letter of Credit Fee (the " Letter of Credit Fee ") for each Letter of Credit in an amount equal to (i) in the case of any Financial Letter of Credit, (A) a rate per annum equal to the Eurodollar Percentage for Revolving Credit Loans in effect from time to time for each day during the applicable calculation period as set forth in the grid in the definition of "Applicable Rate" times (B) the daily maximum amount available to be drawn under such Letter of Credit (whether or not such maximum amount is then in effect under such Letter of Credit) or (ii) in the case of any Performance Letter of Credit or Documentary Letter of Credit, (A) a rate per annum equal to 75% of the Eurodollar Percentage for Revolving Credit Loans in effect from time to time for each day during the applicable calculation period as set forth in the grid in the definition of "Applicable Rate" times (B) the daily maximum amount available to be drawn under such Letter of Credit (whether or not such maximum amount is then in effect under such Letter of Credit)."



(h) Section 2.03(i) of the Credit Agreement is further amended by deleting the reference to "the first Business Day after the end" in the second sentence thereof and replacing it with the phrase "the last Business Day".



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(i) Section 2.03(j) of the Credit Agreement is amended by deleting the reference to "the first Business Day after the end of such" in the second sentence thereof an ...